Intel: Sub-$1000 notebooks possible

What do you get if you add the upcoming mobile Pentium III chip and cheaper LCD panels? Bargain-basement Celeron notebooks. Maybe.

Could notebooks break the sub-$1000 barrier? It's not outside the bounds of reason, according to Intel.

"We're thinking that by the holiday season next year, there could be a switch in what you're seeing for notebook prices, versus desktops. The delta could be a lot smaller," said Sam Wilkie, a product manager in Intel's Mobile and Handheld Products Group.

Intel rolled out new 433MHz and 466MHz mobile Celeron processors on Wednesday. And notebook vendors Gateway and Dell Wednesday announced new systems with the Celeron chips, starting around $2000 (about £1240). However, once Intel's mobile Pentium III hits the market this fall and an ongoing LCD panel shortage lifts, though, that $2000 price tag could fall sharply.

"When people look at less than $2000, they say, 'That has to be a Celeron processor'," Wilkie said. "That will change in the beginning of next year. We would expect to see Pentium III (notebooks) below $2000 in the beginning of next year. Once that occurs, "the Intel Celeron processor would definitely be a sub-$1500 brand," Wilkie said.

And what about sub-$1000 Celeron notebooks? "I think that is a possibility, long term, but it has to do with (LCD) panel availability and price," he said. Gateway and many other vendors currently sell notebooks that are priced around $1500. Its Solo 2500 model, for example, costs $1549 with a 400MHz Celeron chip.

Andy Klopstad, Gateway's consumer portable product manager, agrees that LCD panels will be a key component in sub-$2000 laptops. "When you say sub-$2000, it will also come down to what size panel these people are offering. Right now the panel is controlling that large percentage of the cost of notebooks," he said.

Wilkie would not detail specifics, but other Intel officials have said the mobile Pentium III chip will start at 400MHz, 450MHz and 500MHz. Notebooks will also get a boost from an increase in system bus speed from 66MHz to 100MHz, which is supported by the chips. The system bus is the pipeline over which data flows between the chip and the rest of the system components, such as memory.

Intel's 433MHz and 466MHz Celeron announcement brought with it new models in Gateway's Solo 9300 lineup, with support features, such as a CD-Rewritable drive from Gateway. (See Intel revs 433MHz, 466MHz mobile Celerons.)

Intel, however, feels this is an anomaly and that, given the chance, Gateway would have introduced CD-RW technology on a high-end Pentium II or Pentium III machine. The company considered releasing 433MHz and 466MHz mobile Pentium II processors, however "it didn't make sense because the Pentium III is so close," Wilkie said. "With the intro of the Pentium III processor you'll see new technology aligned with our premium brand," he said.

Gateway agrees, to some extent. "CD-RW is an enthusiast product, still. At launch, the majority of people that would want the product would also want the 15-inch screen, the 18GB hard drive... and the Pentium II," said Klopstad, adding that "there's no reason why someone who wants a CD-RW drive couldn't go with Celeron to save money."

Intel's mobile Pentium III is expected to debut in October. And, while mobile Celeron will be low-cost, it won't be low on performance. "Next year, We'll add even more performance to the Intel Celeron processor," Wilkie said.

Intel will beef up the chip's performance in the first half of next year by moving it to Intel's 0.18 micron manufacturing process, he said. The benefits of the process, utilised by the forthcoming Pentium III, will be increased performance and lower power consumption.